Climate Disinformation and the Financing of the Energy Transition in the European Union
Author:Adrian Gheorghe Florea and Juma Hillary Wafula
JEL:Q54, G18.
DOI:10.24818/EA/2026/73/921
Keywords:Fake news, climate finance, energy transition, climate misinformation, greenhouse gas (GHG) emissions, Instrumental Variables Two-Stage Least Squares (IV2SLS), Extreme Gradient Boosting (XGBoost), Climate FEVER dataset.
Abstract:
In the context of the intensification of misinformation on climate change and the importance of public financing for the energy transition, this article analyses whether informational factors influence the allocation of climate funds in the European Union. The existing literature has mainly examined the social, political, and communication-related effects of climate misinformation, devoting less attention to its macroeconomic implications for public financing decisions. Starting from this gap, the study investigates the relationship between climate misinformation, economic capacity, greenhouse gas emissions, and energy transition financing across the Member States of the European Union. The analysis uses a panel dataset for the EU-27 covering the period 2014-2023, which integrates indicators related to climate financing, real GDP per capita, greenhouse gas emissions, and climate misinformation derived from the Climate FEVER dataset. The methodology combines panel econometric models, dynamic estimations, spatial analyses, and machine learning predictive techniques.
The results show that climate misinformation does not exert a statistically significant effect on climate financing in the econometric specifications tested, whereas economic capacity and the institutional persistence of previous allocations remain the main determinants of financing. The spatial analysis does not confirm the existence of significant regional effects of misinformation, while the predictive modelling indicates the dominant role of economic factors in shaping future climate financing. The study’s original contribution lies in integrating the informational dimension into the analysis of the determinants of climate financing and in demonstrating that European institutional mechanisms for resource allocation appear relatively resilient to the direct influence of misinformation. The findings extend the literature on the economics of climate policy by highlighting the relationship between economic, institutional, and informational factors in the financing of the energy transition.